Economy 'to grow by 2.1% in 2014'
Published 29/01/2014 | 11:27
Ireland's economy is forecast to grow by more than 2% this year.
The Central Bank's first report on the outlook for 2014 has warned that more work needs to be done to improve fiscal consolidation, making banks more sound and growing employment by improving competitiveness.
Gross Domestic Product - which measures the value of the wider economy including multinationals - is expected to grow by 2.1% this year and 3.2% next year.
The other side of the economy, Irish-only businesses which keep profits in the country - Gross National Product - is expected to grow by 2.2% this year and 2.5% next year.
In its commentary on the state of the economy and prospects for the coming year, the Central Bank said Ireland needs to stick to the same stringent cost-cutting seen during the bailout programme.
"With the ending of the EU/IMF Programme, continuing to build on the achievements of recent years will be crucial to ensuring continued access to market financing at relatively favourable rates into the future," it said.
The first quarterly bulletin of the year also offered better prospects for the labour market with estimates that unemployment will drop dramatically from 13.2% to 11.9% this year and then next year down to 11%.
The report called for further progress in terms of policy implementation across a range of areas to ensue before Ireland is seen to have recovered from its economic meltdown.
It called for further reductions in public and private debt , steps to get the banks back to a position where they can offer adequate lending and more work to boost employment.
The Central Bank said the main banks need to be put on a sustained sound footing through further work to sort out the mortgage arrears crisis and issues around impaired loans.
It also warned the Government not to neglect the importance of maintaining progress in the restoration of competitiveness.
"Continuing to make progress on fiscal and banking issues and enhancing productivity and the competitiveness of the economy is the best way to ensure that the emerging improvement in economic conditions can be sustained," the report said.
It said the economy slowed at the start of last year as exports were hit when ph armaceutical patents expired and demand slowed from trading countries.
Estimates for the year put GDP at 0.4% and GNP at 2%.
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